Comcast, Charter announce wireless partnership

Tammy Harvey
May 9, 2017

Both companies have been moving into the wireless communications space.

The deal will also help speed up their entry into the highly competitive and over-saturated market for mobile service in the United States.

"By working with the team at Comcast, we cannot only speed Charter's entry into the marketplace, it will also enable us to provide more competition and drive costs down for consumers at a similar national scale as current wireless operators", Tom Rutledge, chairman and CEO of Charter, said in a statement.

Comcast and Charter will get their engineers to work together on new tech. By comparison, the S&P 500 index has gained more than 7% in the year. The agreement also blocks either company for independently buying, or selling to, a wireless carrier for a year.

In 2016, Charter bought Time Warner Cable, then the nation's No. 2 cable operator, after the federal government opposed Comcast's $45 billion deal for Time Warner Cable.


Tom Rutledge, Charter's chairman and CEO, added, "By working with the team at Comcast, we cannot only speed Charter's entry into the marketplace, it will also enable us to provide more competition and drive costs down for consumers at a similar national scale as current wireless operators". The joint venture could lead to more innovative products, since engineers at both companies will work closely together, and potentially lower prices for customers by gaining negotiating leverage with Verizon or another wireless operator. But legitimate wireless competition from cable could also strengthen their case with regulators for a merger. Within our footprint, our network is perfectly suited to provide the data-rich wireless services that customers are increasingly demanding.

"This is more than two companies just working out an MVNO strategy", Walt Piecyk, an analyst at BTIG Research, said, using the industry term for cable companies reselling wireless service.

The cable companies said that although they'll offer wireless services separately to customers, they will work together on behind-the-scenes matters such as customer billing and device-ordering systems. But there are other options on the table besides a T-Mobile or Sprint deal, he said.

Both Comcast, the largest USA cable operator, and Charter, the second biggest, are seeking new sources of revenue as consumer demand for cable TV packages declines.

The move comes as the two companies prepare to break into the competitive wireless market already dominated by large players such as Verizon, AT&T and Sprint. It plans to introduce the new wireless service to its customers by early June.

Other reports by Ligue1talk

Discuss This Article

FOLLOW OUR NEWSPAPER